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Frau hält eine leere Geldbörse verkehrt herum über ihren Kopf

Salaries in NGOs - Doing good: yes, earning well: no?

Let me say this right from the start: This article is not objective. It is filled with personal opinions and subjective emotions that I cannot suppress when it comes to this topic. However, I believe it is important to talk about it – because something is fundamentally wrong here in our society.

Finding meaning and true value in one’s work is priceless. But unfortunately, meaning and value are not currencies you can use to pay your bills. The question of how much one can earn from nonprofit work is not new—but it remains unresolved. Many are likely familiar with Dan Pallotta’s TED Talk, where he vividly—but not without controversy—explains why cutting “overhead” costs is not a good thing.

In my opinion, especially in times of record inflation and labor shortages, the issue of salaries is critical. This is particularly true if we aim to transition toward a purpose-driven economy.

For those who haven’t seen it yet, here’s Dan Pallotta to set the stage:

Thumbnail Video TED Talk

Whoever does good must not expect compensation…

…because otherwise, the good isn’t truly good anymore, right? This strange perspective is more widespread than one might think. I’ve often been asked, after telling someone about my profession: “Oh, that’s great… but what do you live on?” Many people still assume that NGOs are staffed solely by volunteers and are shocked when they learn that it’s possible to earn an actual salary while working for an NGO.

Fortunately, this assumption is becoming less common. There’s now more understanding that those who work full-time for a good cause also need to earn a living. But, of course, these salaries must be “reasonable.” And here lies the crux of the matter: What is reasonable? Is it reasonable for a fundraiser with 15 years of experience but no managerial responsibilities to earn a full-time salary of €1,700 net? That’s industry standard, after all. As an entry-level employee, you often start close to the poverty line. I find this unacceptable, and I hope many others do as well.

(As an aside: The poverty line for single-person households is approximately €1,200 in Germany and €1,400 in Austria.)

 

Morality is…

…sometimes a double standard. Why else would NGO salaries be judged by a different yardstick?

Why is it acceptable to pay a professional soccer player €50 million, who ultimately contributes little more to society than entertainment, but when someone working at an NGO to end world hunger earns 0.1% of that amount, it’s considered outrageous? Does the CEO of BMW genuinely create that much more value for society than the director of the Red Cross? True morality would be to pay all those who work tirelessly for a better world a fair salary.

A quick search on Kununu might not provide scientifically robust results, but it does offer some benchmarks:

  • Marketing Manager: €48,800
  • Sales Manager: €59,300
  • Fundraising Manager: €43,200

I chose these three roles because, while not identical, they are at least comparable. Is it fair that marketing or sales managers, who essentially do nothing more than bring more or less meaningful products to customers, earn so much more than someone raising funds for charitable projects? I don’t think so.

 

Conscience and passion for the cause…

…also play a role in the problem. Anyone who pays their electricity bills (and everything else) with donations has likely heard this little voice in their head. It whispers: “This is money someone gave to make the world a better place, not for me to buy groceries with.” But that voice is wrong. Without people who can dedicate themselves full-time to “the good cause,” there would be far fewer “good causes.” Not everything can be done by volunteers, and not everyone can afford a life without a steady income.

Good pay for good work is, in my opinion, not immoral, no matter the industry. Yet, I always found it difficult to ask for a raise while working for NGOs. This is partly due to the lack of benchmarks. When it comes to salary transparency, most people suddenly fall silent—even though it’s a crucial step toward greater fairness, understanding, and openness, as well as reduced discrimination and mistrust. With greater transparency, salaries in NGOs could gradually increase.

 

What do you actually earn…

…is a question I once asked the CFO of a nonprofit I worked for over a beer after work. To my surprise, I got an absolutely transparent answer—and the amount he named was equally surprising. The net figure he mentioned was under €2,000 (full-time). But let’s stick with the topic of transparency:

After this honest disclosure, I saw my own salary in a completely new light. It became clear to me that the wage gap within NGOs is much narrower than in the private sector. Leadership positions are laughably underpaid by comparison, while the differences at the “lower end” of the scale are much less pronounced. On the one hand, that’s nice, but it also means that many talented individuals with the skills and experience to excel in NGO management positions never even consider pursuing that path.

At another organization, I didn’t even need to ask that question. I could answer it myself—with a glance at the publicly available salary structure. This is standard practice in public service, universities, and hospitals—so why not in nonprofits as well?

We are the good ones because…

…we advocate for change in society, striving to make it fairer and the world a better place to live. But what’s fair about paying people at the lowest possible limit? What’s fair about someone earning half as much at a nonprofit as they would at a for-profit company? As NGO workers, we aim to change the world. We fight poverty, injustice, and social inequality every day with our work. So isn’t it illogical to accept and even reproduce these very social injustices within our own microcosm?

I don’t want to place the blame solely on the leaders of these organizations. They are under societal pressure and must adhere to the limits imposed by donation certification bodies and legislators. If salaries in NGOs are not “reasonable” (meaning “low”), they risk losing their nonprofit status or facing penalties for misusing funds. However, these concerns usually apply to six-figure salaries—something that’s already rare in our sector.

 

What’s bad for employees…

…is ultimately bad for the organization. Salary might play a secondary role in job satisfaction, but only if everything else is right. The mantra of “avoiding too much administrative overhead” often results in everything else being wrong. Cutting corners on staffing means one person does the work of two for a (small) salary. Skimping on resources means this person lacks the tools to properly do their two jobs.

The result is that employees burn out or quit early. This leaves the organization with high recruiting costs and a disrupted team that constantly has to onboard new colleagues and adapt to changing dynamics.

Efficiency is often cited in discussions about administrative expenses. Of course, donations should not be wasted. But isn’t good administration and the proper provision of resources essential for efficient work?

Fair pay and adequate, non-stingy resources for the team, in my opinion, directly benefit the mission.

 

Donors would…

…not understand, is something you hear often. Because donors want every cent of their contribution to go toward the mission. I understand that, but I still believe this is a fundamental mistake. As mentioned earlier: If no one can afford to work for a good cause due to capitalist constraints, then there simply won’t be a good cause.

Nonprofit Quarterly touches on this in an article, stating: “(…) nonprofits face mixed feelings from the public and funders about whether their employees deserve to earn wages comparable to business or government workers.”

Do we deserve it? What kind of question is that?

The same article cites a survey by the Charities Review Council in Minnesota, which asked 800 people about the issue: 42% agreed that nonprofit employees should earn as much as their for-profit counterparts. 34% thought NGO salaries should be lower, and 14% believed we should earn no more than a stipend.

Maybe it’s time for us to be bolder and start communicating about this issue. Showcase our daily work, create understanding… explain that it’s just as important for an NGO to afford skilled press officers or data analysts as it is for BMW. That campaigners need not only excellent subject matter expertise but also strategic know-how, which can be rare and therefore valuable. That fundraisers provide the financial means necessary for good causes through their skills and experience. That good people with knowledge and expertise drive the mission forward in sustainable ways, but they also come at a cost.

We’ve raised awareness for so many issues—why not for ourselves?

 

At the end of the day…

…our system is fundamentally flawed. Performance should be measured by the value it brings to society and compensated accordingly. Jobs that simply make individuals richer or produce unnecessary products at the expense of our ecosystem should be scrutinized—not those that are indispensable for our world. But this would require a 180° shift in how we perceive (added) value.

Let’s—as NGO workers—take the first step and stop feeling guilty for earning fair wages. Let’s stop skirting around the taboo of NGO salaries. We need to talk—about salaries, about the value of NGO work to society, about fairness and injustice.

Who, if not us?

 

Reading recommendations on this topic:

Ensemble News: The Nonprofit Pay Problem and What We Can Do about It

Nonprofit AF: When you dont disclose salary range on a job posting, a unicorn looses its wings 

Stanford Social Innovation Review: The Real Salary Scandal

NonProfit Quarterly: Buchanan: Pallotta’s TEDTalk Rooted in “Fallacy and Distortion”

 

 

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